Digital Staples and Modern Utilities

It used to be simple.

In a recession, you bought Kraft. Or Clorox. Or maybe Duke Energy if you wanted to feel fancy. The idea was that no matter what happened in the market or the economy, people still needed toothpaste, electricity, and cereal. These were the staples—the no-brainer safe havens for long-only investors in bear markets. But what if the staples of the 21st century aren’t found in the grocery aisle anymore? That time might be over. What if they’re in the cloud?

We live in an economy where companies can go a week without coffee in the break room, but not a minute without cloud infrastructure or endpoint security. That’s not just a trend. That’s a paradigm shift.

Let’s talk about it.

Digital Staples

In 2020, the whole world shut down—and yet business didn’t. Why? Because Zoom worked. AWS scaled. Microsoft Teams showed up on time (most of the time).

Cloud infrastructure, cybersecurity, digital workflow platforms—they didn’t just survive the storm, they powered the economy through it. And what long-only managers started to realize is that these aren’t luxuries. They’re lifelines.

These aren’t just tech stocks. They’re digital staples.

What If Tech Is the New Utility?

Think about it.

Cybersecurity and cloud platforms are no longer growth luxuries. When inflation spikes, rates rise, and the economy slows, CFOs don’t say: “Let’s stop protecting our networks and ditch the cloud.” That’s like saying, “Let’s save money by not locking our front door.” You don’t cut cybersecurity spending because there’s a recession. You don’t pull your CRM system to save on costs. That’s not belt-tightening—that’s corporate suicide.

Cybersecurity and cloud platforms are no longer growth luxuries. They’re mission-critical.

And in a world where digital infrastructure is the backbone of business, long-only institutions are rethinking what a “defensive stock” really looks like.

These names are no longer just “tech plays”—they’re infrastructure.

And when markets tighten up, money flows to what’s essential. This is why you’re seeing institutional flows migrate to names like PANW and CRWD. Their services aren’t optional in a modern enterprise—they’re non-negotiable.

We’re not saying these are recession-proof. But they’re recession-relevant.

The New Rotation Playbook

In every bear market, there’s a flight to quality. But quality looks different now. The old recession playbook—buy staples, avoid tech—isn’t dead. It’s just evolving.

Institutions with a “long-only” mandate aren’t just hiding in Campbell’s and Colgate anymore. They’re rotating into mission-critical tech. And they’re doing it for the same reason they’ve always bought staples: consistency, resilience, and cash flow. Institutions still want cash flow, recurring revenue, and moats you can’t jump over with a startup and a VC check. But now they’re finding that in software, not soup.

So if you’re still thinking of tech as a “growth-only” trade, it might be time to update your mental model. This doesn’t mean you dump your staples. It just means you understand that defense today might look like firewalls, cloud subscriptions, and zero trust security models.

Bottom Line

A bear market doesn’t mean you stop playing offense—it means you pick players who can stay on the field no matter the score. And increasingly, those players are the companies building and securing the digital infrastructure of modern life. The next time we get a pullback, look closely at where the money hides. It may not be hiding in Clorox. It may be hiding in the cloud.

Because in a world running on code, your safest bets might just be the companies that keep the lights on digitally. Welcome to the age of cloud as a commodity. Welcome to the era of Digital Staples and Modern Utilities.

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